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Words of wisdom

Here’s an articulate, thoughtful and comprehensive piece about the tech bubble debate. I’d like to quote a paragraph I think every investor should remember:

“No one can predict macro trends. The bear case includes: something bad happens to the economy (Euro collapses, US enters double dip recession). The warning sign here will be a drop in profits by marquee tech companies. The bull case includes: economy is ok or improves, and tech continues to eat into other industries (the “software is eating the world” argument). Anyone who claims to know what will happen over the next 3 years at the macro level is blowing hot air. That’s why smart investors continue investing at a regular pace through ups and downs.”

I couldn’t agree more. Smart investors should ignore what I call ‘noise’. Though as with every rule there’s always an exception. If a lot of people start bragging about their investment portfolio at your uncle’s birthday party you should probably exit the market… And vice versa.